Research: Bitcoin Cash Declining in Adoption and Merchant Use Cases
Blockchain analysis and forensics firm Chainalysis recently produced a report on payments received by the world’s top 17 cryptocurrency merchants, concluding the role of Bitcoin Cash (BCH) has steadily decreased in most day-to-day transactions.
As reported by Bloomberg, a group of researchers from Chainalysis observed a stark decline in BCH transactions in 2018. While payments soared at $10.5 million in March 2018, the number dropped to a mere $3.7 million two months later.
BCH data was collated from merchants including BitPay, Coinify and GoCoin, three of the largest crypto-payment providers.
In comparison, Bitcoin recorded figures of $60 million in the same month but was similarly down from a $412 million high in 2017.
Regarding price action, BCH declined by over 75 percent from its all-time high, while BTC fared comparatively better with a 55 percent plunge. Additionally, BCH remains the world’s fourth-largest cryptocurrency by market cap; however, it forms only 10 percent of the total BTC cap.
Kim Grauer, a senior economist at Chainalysis, noted the number of holders and users of BCH was steadily declining. Grauer also highlighted that “concentration ownership” led to BCH’s eventual loss of favor, presumably referring to the loyal, but small, set of supporters the controversial Bitcoin hard fork enjoys.
She added that only 67 BCH wallets hold over 56 percent of the currency, which is not seen on any prominent crypto-exchange.
The economist estimates between 10,000 and 100,000 BCH are held by two wallet addresses, adding that only the most BCH-wealthy holders “send a lot of traffic to merchant services.”
Meanwhile, BCH proponent Roger Ver has remained undeterred. He pointed out the benefits of BCH transactions in a tweet, Aug. 13:
The long term price of a crypto currency is a function of its usefulness as a currency. pic.twitter.com/0LjX3fBrQb
— Roger Ver (@rogerkver) August 13, 2018
Cover Photo by chuttersnap on Unsplash
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